European Commission on cusp of steel safeguard review

15/02/2021

The European Commission is likely to launch a review into its tariff-rate quota steel safeguard in the coming weeks.

Member states representing the bulk of the EU’s steel production — Netherlands and Sweden aside — requested the review with a view to the safeguard being extended, as has European steel association Eurofer. The safeguard will lapse at the end of June, as it stands.

The review does not mean the safeguard will be extended, it could still lapse, be extended or modified for certain products.

Producers suggested nothing has changed since the safeguards were implemented, with Section 232 tariffs still in place in the US. Should the quotas be removed, material would be diverted into Europe, they said.

But some still expect the measures not to be extended, as the commission looks for more World Trade Organisation compliant methods of maintaining traditional import flows. Buyers point to massive mill margins and constrained import supply — with Turkey now subject to provisional dumping duties and Russia’s Severstal having its duty reviewed. Given the struggle buyers had securing the requisite material this year, they said extending the safeguard would be unfair.

Mill sources point out that the safeguard was not designed to deal with the impact of the pandemic, but ensure material is not diverted from other regions with their own import protections in place.

CBAM